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The Greek colony

by talos Mon May 30th, 2011 at 04:41:16 AM EST

According to the FT, Greece is in the process of completely relinquishing its sovereignty to its creditors:

European leaders are negotiating a deal that would lead to unprecedented outside intervention in the Greek economy, including international involvement in tax collection and privatisation of state assets, in exchange for new bail-out loans for Athens.

This is pretty much an explicit call to plunder the country. So much for solidarity it seems...

Promoted by DoDo


Zerohedge has the story and they quote TF Market's Peter Tchir stating the obvious, at this point:

If Greece stops paying, the lenders cannot 'foreclose' on it.  There is no law that dictates how to proceed like chapter 11 does.  The bonds have very few if any covenants.  The lawsuits would have to be won in Greek courts and then enforced by people employed by the Greek government.  Good luck with that.

The reason the lenders have an almost irrational need to avoid a default, is they don't know what they will get if Greece does default.  There is no good way to analyze it.  Their ultimate recovery will be based on some threats of future lending, rights of set-off, and maybe some threats of trade sanctions, but unlike a mortgage or a corporate bond, there is no good way to analyze the potential outcome.  There is a reason 'vulture' funds focus on corporate debt much more than sovereign - there is a way to analyze the outcomes, it is not just guess work.

So people can continue to comment on whether Greece should be allowed to default, but that misses the point.  Lenders can make it easy for Greece to make payments, but choosing to default or not remains solely a Greek decision and they should do what is best for them.

Tonight, after the huge (and unreported) demo at Syntagma today (part of the "real democracy" movement that started in Spain) the people's council floated the idea of a tax strike should IMF or ECB fiscal stormtroopers managers be involved in tax collection. This I consider to be only the first of many acts of the Greek population that will de facto make impossible the pursuit of the creditors' plans, except by deadly and massive force, if that.

This is bizarre even from the EU/ECB/German perspective. They are forcing the Greek government either to make a stand and default, possibly leaving the Euro, or go down history as a quisling government, incapable to even do the dirty work that is assigned to them.

If the Papandreou government does the honorable thing under the circumstances and defaults, the scenario of what would come after, was thoroughly and convincingly analyzed today by economist Yanis Varoufakis who concludes that:

It is in this sense that the threat to expel Greece from the euro is a cheap form of empty blackmail-like threat, the purpose of which is to exact from the Greek polity many pounds of flesh, by which to impress Northern Europe's despondent electorates that Greece deserves another huge, expensive loan. As is so often the case with naked blackmailing, an incredible threat is pressed into the service of an ill-conceived goal: To the issuing of a fresh gargantuan loan to an insolvent country that neither needs nor wants it.

Should these scenarios materialize then (if they are not propaganda tricks that is), if Varoufakis is correct and the creditors' bluff is not called, I cannot imagine how a government that accepts them will even be able to escape the country. Not enough helicopters.

Display:
Didn't Papandreou say just last week that "I want to add one thing on which we are very sensitive: to ask us for an island or a monument as a guarantee is nearly an insult. The people expect our word and our actions are a sufficient guarantee."

So, Papandreou now agrees to the insults?

by Upstate NY on Sun May 29th, 2011 at 08:47:40 PM EST
Do the troika have his family as hostages?

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sun May 29th, 2011 at 09:01:47 PM EST
[ Parent ]
Or just his mind?

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Sun May 29th, 2011 at 09:02:18 PM EST
[ Parent ]
From the zero hedge article referenced by Talos:

It is Greece's decision to default or not, NOT the ECB's or EU's

I continue to be confused by the fact that most people talk about the issue from the lender's perspective.  "Should Greece be allowed to default?" "Does it teach Greece a bad lesson if they let them walk away? "  "Won't Greece just default again if the ECB lets them walk away?"

The reality is the IMF, or ECB, or EU can offer money to Greece, but it is Greece's decision to borrow more to pay off old debts.  Only Greece can decide to make payments and not default or demand restructuring.  Other entities or countries can make it easier for Greece to kick the can down the road, but in the end, only Greece can decide whether or not to pay its bills.

The people of Greece seem to prefer default.  It is fairly clear that this is not a short term liquidity problem, but a longer term solvency problem for Greece.  Greece has some assets it can sell, but as I have said time and again, they will still have those assets to secure new funds after a default/restructuring.  I continue to believe it is in the best interest of Greece to default and it is their decision, no one else's.  It may be bad for the rest of Europe if Greece defaults, but that really should not be the priority of the Greek government.

If Greece defaults, the creditors can then take steps to enforce their rights.  If a person fails to pay on their mortgage, the banks can enact their rights to foreclose.  If a U.S. company fails to pay its debt, creditors will suit, and the company and debtors will typically resolve the issue in the courts under Chapter 11 or Chapter 7.  There are similar statutes for corporate defaults in other countries.  The real reason that we are hearing so much about this from the lenders perspective, rather than the borrowers, is because it is not very clear what the lenders' rights are if Greece stops paying.

If Greece stops paying, the lenders cannot 'foreclose' on it.  There is no law that dictates how to proceed like chapter 11 does.  The bonds have very few if any covenants.  The lawsuits would have to be won in Greek courts and then enforced by people employed by the Greek government.  Good luck with that. (Emphasis added)

I continue to be confused by the fact that most people talk about the issue from the lender's perspective.
 
I doubt he is confused. The MSM is owned by those who have exposure and many other potential observers work for those who service those who have exposure. The issue is being framed from the lender's perspective and they hope not many will notice. The "confusion" is rhetorical.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon May 30th, 2011 at 11:15:27 AM EST
[ Parent ]
Foreign assets
http://news.bbc.co.uk/2/hi/6365433.stm

Zambia being weak, the legal system was on the case.

Whether Greece has a better legal case is hard to tell. But the legal situation was explained perfectly in the Melian dialogue by a Greek historian.

by rootless2 on Sun May 29th, 2011 at 09:35:20 PM EST
I've once suggested here that paying taxes in PIGland is essentially akin to feeding rapists.

The only way for this to stop (assuming that the PIG elites are more interested in sustaining the current status quo, which they obviously ARE) is precisely to withdraw tax payment.

There are, by they way, many lawful ways doing this. For instance by stopping consumption of un-needed products (especially of distant origin). Another example: I stopped asking for a tax receipt, asking for a tax receipt would force the shop to declare the transaction, now it is up to the other party to decide.

I remember being one of the first persons to explicitly asking for a tax receipt (was seen as odd, and some sellers would obviously not like it). Now I explicitly say I do not need or want one.

It is depressing to think of a supposedly liberal, democratic state as a person of ill intentions.

by cagatacos on Sun May 29th, 2011 at 10:21:42 PM EST
Just to answer myself...

The problem with a tax strike is that our EU masters might respond with confiscatory property taxes over the middle classes (which are essentially impossible to dodge). What about a tax over your home of 5% its value, to pay yearly?

Before you suggest this is impossible, I would like to remind that the Portuguese rape already does include measures in this direction. Don't believe me? Go read the agreement. Agreement between the Portuguese government and the EU-ECB-IMF which by the way has no version in Portuguese (only a summary).

Of course, if it comes to that, than open revolt will probably ensue.

by cagatacos on Sun May 29th, 2011 at 10:49:45 PM EST
[ Parent ]
Just wondering, what country are you in where you collect tax receipts. As an American, I don't understand the phenomenon. Here, you can't recover the sales taxes you pay so there's no point in keeping receipts for tax purposes. Instead, people conduct business mostly with credit cards and the like. Small businesses are sometimes caught cheating when--for instance--the authorities check invoices for materials. Why does the pizza shop need 10,000 boxes of pizza when it only sold 2,000 pizzas in the last few months? That kind of thing. Otherwise, small retailers show cash register reports.
by Upstate NY on Sun May 29th, 2011 at 11:38:37 PM EST
[ Parent ]
I am in the US, as I write this. But surely that was not your question ;) . I am Portuguese.

I am unable to provide an insightful comparison, especially because I do not know the details on how controlling is done. But it works like this:

If I do not ask for a VAT receipt, then it is up to the business to declare it or not. If I ask for a VAT receipt, then I might present it to the tax authorities (to get VAT back - if you are a business yourself - and to get a reduction on income based tax - as it is an expense). If I present my VAT receipt, then the seller must have to present their version also. VAT receipt = transaction HAS TO BE declared, thus taxed.

If they present their version that means that they will have to pay at least VAT. Probably they will have to pay income tax on it also.

If I do not ask for one, then they might not declare the income. They immedeatly pocket the VAT (between 12 and 24%) and (possibly) the income tax.

I do not think that the tax authorities go very far with the checking of "bought 20.000 cases of pizza and only sold 1.0000". But I am not sure.

A few years ago, around 60% (or so) of business were declaring negative income. Obviously this means that most of these business were evading taxes (e.g no income tax) a lot. Things become a bit better in the last few years.

This is my laymen view on the issue, but Migeru might want to chip in about the Spanish situation. It should be similar and he surely is more knowledgeable than I am about these issues.

by cagatacos on Mon May 30th, 2011 at 12:47:25 AM EST
[ Parent ]
Thanks, I was just wondering how it worked.
by Upstate NY on Mon May 30th, 2011 at 08:49:41 AM EST
[ Parent ]
Works that way in Mexico too. Large "underground/informal economy" that pays no taxes and somewhat smaller one that declares pays less than full value of sales. Difficult to obtain VAT receipts from those (most tradesmen)in the informal economy.  We don't even ask, except for something required for the US IRS. Can't blame persons who barely make enough to survive even paying no taxes.

I can swear there ain't no heaven but I pray there ain't no hell. _ Blood Sweat & Tears
by Gringo (stargazing camel at aoldotcom) on Mon May 30th, 2011 at 11:03:30 AM EST
[ Parent ]
I think it is the difference between sales tax and value added tax.

Value added tax - Wikipedia, the free encyclopedia

Value added tax (VAT) in theory avoids the cascade effect of sales tax by taxing only the value added at each stage of production. For this reason, throughout the world, VAT has been gaining favour over traditional sales taxes. In principle, VAT applies to all provisions of goods and services. VAT is assessed and collected on the value of goods or services that have been provided every time there is a transaction (sale/purchase). The seller charges VAT to the buyer, and the seller pays this VAT to the government. If, however, the purchaser is not an end user, but the goods or services purchased are costs to its business, the tax it has paid for such purchases can be deducted from the tax it charges to its customers. The government only receives the difference; in other words, it is paid tax on the gross margin of each transaction, by each participant in the sales chain.


Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se
by A swedish kind of death on Mon May 30th, 2011 at 07:11:48 AM EST
[ Parent ]
And of course that's not the reason it's been gaining favour at all.

The reason it's been gaining favour is that it is an absolutely marvellous way to create incentives for businesses to report their volume of business to the sovereign. For states with weak statistical services, a VAT is a wonderful tool for macroeconomic planning. Because it means that (a) the tax collector will only have to enforce business taxes on the final point of sale rather than the whole chain, and (b) it gives you fairly detailed microeconomic data on pretty much your whole economy.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 30th, 2011 at 10:01:36 AM EST
[ Parent ]
is yet another invention of the French bureaucracy.

Cf Colbert and the plucking of goose...

Wind power

by Jerome a Paris (etg@eurotrib.com) on Mon May 30th, 2011 at 05:21:25 PM EST
[ Parent ]
"Tax strike" is the problem, not the solution. It is what the small and large business and the professionals are doing all the time in Greece. They do it since this country exists and they did it with renewed vigor and modern tools more recently (they used offshore companies, triangle invoicing and whatever money laundering tools you can imagine). The previous conservative government helped tax evasion to take off - it was a basic promise of the 2004 election - and the same party is now telling these people that when they come back to power they will give tax amnesty for one year and money laundering tools forever (for example they said that you wont have to explain where did you find the money to buy residential property).

The idea of a "tax strike" is quite neo-liberal. It reminds me of Ronald Reagan, G.W. Bush and Sarah Palin more recently.

In Greece, tax collection is very low. Direct taxes are just below 5% of GDP in Greece while they are close to 10% in the EU. Tax rates are similar. So there is a lot of tax-evasion, or 'tax strike' if you prefer to call it. Multiply the missing 5% by 6 or 5 years and you can find out that public debt has financed the tax evasion of the professional and small and large business. Now the private sector employees are called to pay the bill.

Actually the idea of outsourcing part of the tax collection system is not that bad. If the Troika is as good as it claims, let them prove that they can crack down tax evasion of the professional and the businesses. But they should put their money at stake, not ours.

"Eurozone leaders have turned a €50bn Greek solvency problem into a €1,000bn existential crisis for the European Union." David Miliband

by Kostis Papadimitriou on Mon May 30th, 2011 at 02:10:46 AM EST
[ Parent ]
I can relate to the situation very well, as it is very similar in my home country.

Indeed, it has been a local fight of some left here to lower tax evasion. And the right has always fought it (and mostly won).

But...

Considering that in the current circumstances, where collected money is, in a great part, being used to transfer money to our rapists, I can see how the idea is attractive. Also, it is a way to force a default.

All in all, the (dreadful) idea behind this proposal is that the state is not a decent partner, deserving of trust.

These are really strange and dangerous times...

by cagatacos on Mon May 30th, 2011 at 02:48:40 AM EST
[ Parent ]
Oh I agree that under normal circumstances tax strikes are bad. In fact I have payed my taxes consistently (not that I had much option since people with salaries do pay taxes - as do middle incomes more or less, see here esp.table 4 p.20) Under what amounts to foreign occupation though, things change. And I would not suggest that people keep their taxes. I would suggest that they should be deposited somewhere and declared available for the next sovereign government.

The underperformance of Greek revenue collection is the major constant source of deficit, along with very low corporate taxes and the fact that shipping (the industry and its owners) does not pay any direct taxes.

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Mon May 30th, 2011 at 06:15:24 AM EST
[ Parent ]
I wonder if undercollection is the major source. The official evasion numbers (25%) are not so far off the European norm (19%) that more robust collection would garner more than $5 billion additional. Plus, Greece's collections as a % of GDP are just 2% off the eurozone average (41% in Greece to 43% eurozone). Greece would be regarded as a high tax country on par with Sweden if it collecting taxes at an evasion rate similar to other nations.

I would qualify all this to say that Greece's system must then be distorted in that some people pay a hugely disproportionate amount to others.

by Upstate NY on Mon May 30th, 2011 at 08:57:23 AM EST
[ Parent ]
Greek tax revenue was in 2006, 8 points GDP below the EU15 average. That's a lot of revenue. If one bears in mind that revenue from indirect taxes was not similarly lagging, and is in fact around 60% of total tax revenues, (see more on tax structure in the EU here)one sees that there is a large problem in direct tax collection. There are some that argue that this is not mainly due to corruption (although that too has a further effect by its own) but structural, due to the enormous by EU standards number of self-employed and small businesses (here is the argument in Greek in case anyone can read greek). I'm not sure about that, but it's worth pondering...

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Mon May 30th, 2011 at 09:52:26 AM EST
[ Parent ]
Talos, I've been looking at OECD recently and posted here on their numbers. They have very bad numbers. Just look at their record of Greece's debt to GDP over the last decade. It's like a night and day difference with the numbers Europe is going through Eurostat audits. I mean, OECD does not even have Greece's yearly deficits at +10%. I posted on this recently that the OECD numbers are highly suspect. I looked into it and they source their numbers by having their finance committee get reports from national administrations, but those numbers are never again revised. Eurostat has personnel that travel to countries and conduct audits.

The difference between OECD and Eurostat is huge, over 10% of GDP year over year in the case of Greece.

by Upstate NY on Mon May 30th, 2011 at 10:01:16 AM EST
[ Parent ]
I think (but am not sure right now, I'll have to check it) that Eurostat includes social contribution as tax revenue. That explains the large discrepancy

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Mon May 30th, 2011 at 11:33:15 AM EST
[ Parent ]
Yes, it does.
by Upstate NY on Mon May 30th, 2011 at 12:55:36 PM EST
[ Parent ]
One more thing, though I didn't know that the OECD did not account for social contribution, their deficit numbers are still well off. Greece is not in any serious danger according to the OECD, and Greece even had a few years of 5% surpluses in the middle of the last decade.
by Upstate NY on Mon May 30th, 2011 at 12:57:00 PM EST
[ Parent ]
It had surpluses, before the Olympics and in 2006 and possibly 07 if I'm not mistaken. At the time the IMF was lauding the performance of the Greek economy.

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Mon May 30th, 2011 at 01:07:02 PM EST
[ Parent ]
That's where the two differ, here is the link where Eurostat shows no surpluses:

http://epp.eurostat.ec.europa.eu/portal/page/portal/government_finance_statistics/data/main_tables

Under gov't deficit and debt, click on surplus and deficit

by Upstate NY on Mon May 30th, 2011 at 02:16:26 PM EST
[ Parent ]
talos:
At the time the IMF was lauding the performance of the Greek economy.

Which should always be treated as a loud and clear warning.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Mon May 30th, 2011 at 02:19:42 PM EST
[ Parent ]
The ultimate source is the structural foreign deficit in excess of any realistic sustainable growth rate.

The proximate source may be tax evasion, it may be low taxes or it may be high spending. But as long as you have a structural foreign deficit in excess of your growth potential, you're fucked under a fixed-rate ForEx system.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 30th, 2011 at 10:19:06 AM EST
[ Parent ]
I'm not at all advocating a tax strike for Greece, but the Eurostat numbers show 8%-9% of GDP in tax on income, 13% from social taxes (assuming a kind of pension/health tax? but I don't know the Greek system), 5% corporate tax, and the rest from VAT and sales. All add up to around 40-42% of GDP in tax revenues consistently for Greece over a decade. I assume the figures are correct because they correlate to the deficit numbers that everyone is currently working with.
by Upstate NY on Mon May 30th, 2011 at 08:53:44 AM EST
[ Parent ]
Another strategy might be... emigration.

If all productive labour emigrates, than who you they tax?

Sound ridiculous? Remember that at least 2 of these nations have a massive emigration culture (Ireland and Portugal). A poll in Portugal suggested that 40% of people are thinking about it.

I reckon that around ~30% of nurses below the age 30 that I know of are already in the process.

In my case, I will emigrate (though I spent my working life mostly emigrated, anyway).

The way the system is devised cannot sustain massive emigration of the productive workforce: there will be no one left to rape.

Unless, of course, border controls are re-instated.

They would never do that, of course. Imagine, restrictions to Schengen. Unthinkable. (sarcasm included in this last paragraph)

by cagatacos on Sun May 29th, 2011 at 10:56:49 PM EST
If the announced plans for EU and/or ECB tax collectors to start working in Greece come to pass, I have to wonder about their personal safety as well as the personal safety of every MP who voted for the measures. I am also wondering how long it will be before the Greek conservative party starts claiming Greece was stabbed in the back by the Socialists, (not without some justification!)

It will be interesting to see the ECB attempting to organize Greek police to protect their tax collectors. Even more interesting to see the ECB attempt to organize foreign police or military to protect their tax collectors. Everyone involved in this is mad. The only positive that could come out of it is were the ECB and EU to see that the taxes on the wealthy in Greece are collected from their foreign assets, but that is the action most likely to set off violence.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon May 30th, 2011 at 12:52:37 AM EST
[ Parent ]
Yes it doesn't make sense, and it's dangerous for everyone involved. Indeed the ECB would be in excellent position to demand that deposits of Greeks abroad (and that includes Switzerland, where there are close to ~300 billion Euros in Greek deposits and it seems likely that most of that money is undeclared and fishy) be researched. That would be looked at quite favorably here, by the vast majority.
Surprisingly this was never brought to the table it seems.

As for immigration. There is a large outflow of Greeks over the past couple of years to the EU and beyond. Greece too has a tradition of immigration and large immigrant communities in Germany, Belgium as well as the US, Canada and Australia. 100.000 Greeks are estimated to submit CVs to the EU job database this year - double the number of last year. That's only specialized labor, and only in the EU. Cyprus, I expect to have a population increase of over 200.000 in the next few years.

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Mon May 30th, 2011 at 06:27:15 AM EST
[ Parent ]
Indeed the ECB would be in excellent position to demand that deposits of Greeks abroad (and that includes Switzerland, where there are close to ~300 billion Euros in Greek deposits and it seems likely that most of that money is undeclared and fishy) be researched.
Recall:
German banks target worried Greeks in Germany

Greeks worried about a debt restructuring or a euro exit increasingly transfer their money to banks abroad, Bild-Zeitung reports. According to the mass circulation tabloid German banks such a savings bank in Munich have posted signs in their windows advertising in Greek and German that Greek costumers will be advised in Greek. According to the paper €30bn have already been transferred from Greece abroad since the crisis started.

And, while an ongoing Euro-run on the entire country of Greece is going on, the ECB is not saying anything about it. All we get is Lorenzo Bini-Smaghi hyperventilating about the consequences of a Greek debt restructuring (among them, insolvency of the Greek banks) when the deposit run from Greek to German banks, if unchecked, will by itself bring the Greek banks down.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 06:33:57 AM EST
[ Parent ]
They possibly are reluctant to raise the profile of such a procedure out of fear it would anger their overlords.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon May 30th, 2011 at 10:57:37 AM EST
[ Parent ]

Indeed the ECB would be in excellent position to demand that deposits of Greeks abroad (and that includes Switzerland, where there are close to ~300 billion Euros in Greek deposits and it seems likely that most of that money is undeclared and fishy) be researched. That would be looked at quite favorably here, by the vast majority.

Ah ah ah. You made me laugh.

For a second I almost believed that the ECB was not an instrument of rabid class struggle and that they would  require the upper classes to contribute.

In a more serious tone: that the more cynical views of the hard-left are good descriptions of the current narrative, should make everybody shiver...

by cagatacos on Mon May 30th, 2011 at 11:35:39 AM EST
[ Parent ]
that the more cynical views of the hard-left are good descriptions of the current narrative, should make everybody shiver

Yeah, I have been thinking lately that the Eurosceptic left were right for the wrong reason about the EU being a neoliberal project.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 11:54:15 AM EST
[ Parent ]
  Couldn't (ahem) "they" have been right for the right reason(s)?  

    ;^)

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Mon May 30th, 2011 at 12:32:19 PM EST
[ Parent ]
I think it depends on what kind of hard-left you are talking about.

For instance, lets take the Trotskists. Then clearly they are right for the wrong reasons. Indeed one can argue that neo-liberalism is a Trotskist spin-off (google from neo-liberalism, trotskysm, kristol). Some in the hard-left are globalists to the bone (it is just that this is not they right kind of globalization). I would argue that they are (totally!) wrong: natural systems are diverse and disconnected. Only almost-disconnected actors are able to search for different kinds of solutions to problems. Also, if the global society goes wrong, then everything goes down (for an illustrative example see Western Society 2008-2025).

But some kinds of anarchists might have been right for the (partially) right reasons. Mainly de-centralization, autonomy, localization, ...

by cagatacos on Mon May 30th, 2011 at 12:56:47 PM EST
[ Parent ]

  I really don't know what others mean by "hard-left".  I only know that I have always been a confirmed advocate of a Europe which sees itself as a people with many vital common interests (which shouldn't mean they feel alien to the rest of the world's common interests: peace, economic prosperity based on social justice and open, publicly-accountable elected democratic government, etc.) that deserve their determined support and defence against threats to them by narrower and very powerful organized opposing interests.

   And I've never been in doubt that it is mainly or even nearly exclusively these latter, i.e., narrower and very powerful organized opposing interests, that have been calling the shots on the direction of the E.U., making it, in effect, their own little neo-liberal living laboratory experiment to the detriment of "the rest of us"---those who see things much as I do.

    Thus, we'd have been better off if (among other things)  the Big Shots hadn't rammed the so-called  Treaty of Lisbon or Lisbon Treaty (initially known as the Reform Treaty) down the throats by hook and by crook, effectively trashing the spirit of democratic rule, if not, the very letter, too.

 

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Mon May 30th, 2011 at 01:24:47 PM EST
[ Parent ]
The problem with such well intentioned large structures is that they always end up like that: captured by very despicable groups.

Such structures only work well if they are governed by (theoretical) people with the civil service mindset and the public good in mind.

This fails on several accounts:

  1. In a democracy one can be 100% positive that sooner or later different people from the described above would take power. That is inherent to democracy as power rotates. To want an eternal "perfect" government is profoundly anti-democratic (not to say, unrealistic).

  2. Abstract/distant government structures will attract a certain kind of people. The wrong kind. Even if the good kind is around, but the fact that they are distanced from the ground reality, they are bound to make gross mistakes.

  3. Large, distant institutions have lots of space for the creation of power grabs by power groups. Lobbying and such.

With highly decentralized systems, surely you will have many cases of total disaster. But at least there will be space for something decent to appear. And above all, it will not be "all down the drain" simultaneously.

With centralized systems (e.g. "Europe"), the outcome is invariably the same.

So yes, in my view most of the hard-left was right for the wrong reasons. Indeed, everybody that opposed the current system was equally "correct".

by cagatacos on Mon May 30th, 2011 at 01:48:33 PM EST
[ Parent ]

  And, P.S., (reply here or anywhere you'd deem more appropriate to the matter):

   RE:  "Yeah, I have been thinking lately that the Eurosceptic left were right for the wrong reason about the EU being a neoliberal project."

    What would then ensue from that reconsideration? I wonder.

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Mon May 30th, 2011 at 12:34:26 PM EST
[ Parent ]
Do you want me to recap 16 months of blogging?

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 01:03:05 PM EST
[ Parent ]
  Probably not.  How many lines are we talking about?  Is there a condensed, shortened text I might consult?  And, then, around 16 months ago these doubts sprang seriously to mind, I gather.  Just knowing that alone is helpful.

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge
by proximity1 on Mon May 30th, 2011 at 01:06:32 PM EST
[ Parent ]
Well, I would rather put it this way: "some powerful groups (including governments) are trying hard to make the EU a neoliberal project"

"L'homme fut sûrement le voeu le plus fou des ténèbres " René Char
by Melanchthon on Mon May 30th, 2011 at 01:18:30 PM EST
[ Parent ]
the predictable and predicted result of the rejection of the EU Constitution, which would have legitimized political power at the EU federal (NOT inter-governmental) level and given re-regulation a chance.

Still one of the most brilliant fuckups of the hard left.

Wind power

by Jerome a Paris (etg@eurotrib.com) on Mon May 30th, 2011 at 05:26:45 PM EST
[ Parent ]
So you need to be reminded for the umpteenth time that our current woes have to do with the part of the EU treaties which 1) discriminates against the public sector in favour of the private sector in terms of debt issue; and 2) sets the protection of the purchasing power net worth as the single policy objective of European Monetary Policy with no mention of full employment or financial stability.

Which is basically setting neoliberal misconceptions about macroeconomics in stone at the core of the EU Constituent treaties.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 05:46:38 PM EST
[ Parent ]
the purchasing power of net worth

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Tue May 31st, 2011 at 01:37:19 AM EST
[ Parent ]
the result of voting "no" was the same content in the treaties but without the political legitimacy at the federal level to enact EU-wide regulations.

So we got the worst of both worlds.

Wind power

by Jerome a Paris (etg@eurotrib.com) on Thu Jun 2nd, 2011 at 04:36:45 PM EST
[ Parent ]
I don't want the EPP enacting anything

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Thu Jun 2nd, 2011 at 05:02:18 PM EST
[ Parent ]
Political legitimacy among who? Our political leadership is uninterested, and the EU is not built to care much about the opinions of mere citizens.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se
by A swedish kind of death on Fri Jun 3rd, 2011 at 04:09:30 PM EST
[ Parent ]
It will further reinforce the bad habits of Greece. It will collectively recall the Greek relationship to occupation under the Ottomans and Germans. It will essentially destroy the country.
by Upstate NY on Mon May 30th, 2011 at 08:58:29 AM EST
[ Parent ]
Why the fuck should Germany care?

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 09:02:02 AM EST
[ Parent ]
Yes, this is a likely effect. I think all European countries has some form of rural policy to avoid depopulation of the countryside, farm subsidies if nothing else. And the EU has funds for the development of certain areas.

However, ECB has the reversed policy: stripmine the periphery. If sustained an increased migration to the core is the effect.

Then what chips might fall? As high unemployment policy is in place, an increased competition for jobs in the core brings down wages and feeds resentment. On the national level ugly parties gains, while on the local level the left-of-pes parties can make use fo the migrants right to vote in local elections. So a more polarised and confrontational politics.

And in the periphery? Those that can't or won't leave left with a stripmined state and everything owned by foreigners? If no political solution can be formed, I think that is fertile ground for violent movements of different stripes and colors.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Mon May 30th, 2011 at 07:32:21 AM EST
[ Parent ]
Fascism as the end state of liberalism.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 08:44:08 AM EST
[ Parent ]
When you come to Orwellian formulations like this, you know that rigid ideology has failed. It's more like collective groups of empowered actors (bankers, politicians, even unions, corporations, etc.) devise ways to selfishly erode the system. There seems to be very little to be gained by tootr and the public in such circumstances.
by Upstate NY on Mon May 30th, 2011 at 09:03:03 AM EST
[ Parent ]


Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 09:44:10 AM EST
[ Parent ]
Private sector.

That's my new name for the private sector when for some reason my delete button sticks and concatenates two words!

by Upstate NY on Mon May 30th, 2011 at 09:55:53 AM EST
[ Parent ]
We already see what happens in Greece. And to see how it will play out in the core, here is an example from Finland:

From the Salon

Utlänningar får ny färg på id-kort - DN.SE
Utländska medborgare i Finland får från och med juni i år en annan färg på sina id-kort än finländska medborgare. Foreign citizens in Finland, will from June this year get a different color on their ID cards than Finnish nationals.
De nya korten för utlänningar kommer att vara bruna, medan finländarnas kommer att vara blåa. Polisen vill med de nya färgerna underlätta övervakningen av dem, skriver nyhetsbyrån FNB.The new cards for foreign nationals will be brown, while the cards for Finns will be blue. Police want with the new colors facilitate the monitoring of them, writes the news agency STT.
De gamla identifikationshandlingarna kan användas tills giltighetstiden har gått ut.The old identification documents can be used until the expiry date has passed.


Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se
by A swedish kind of death on Mon May 30th, 2011 at 09:38:10 AM EST
[ Parent ]
The new cards for foreignbrown nationals will be brown, while the cards for Finnsaryans will be blue.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 09:43:17 AM EST
[ Parent ]
This is what I thought immediately. I mean, they could have picked better colors, no?
by Upstate NY on Mon May 30th, 2011 at 09:56:57 AM EST
[ Parent ]
They're not even trying as they don't find it embarrassing in the least.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 11:26:58 AM EST
[ Parent ]
cagatacos:
The way the system is devised cannot sustain massive emigration of the productive workforce: there will be no one left to rape.

i wish i could draw a cartoon of europe pointing a gun to her head, with central bank policy written on the barrel.

banks + power = TBTF = quick profiteering => war and ruin...

resource limitation is the only conceivable brake on this going on for ever, and it stands to get worse before it can get better, too many lawyers and armies round the bones.

sons go the wars, daughters to the manor, twas ever thus; sometimes the tables turn, before turning back again.

perhaps... they will stay turned one day. it will take a hitherto unimaginable level of intention, cohesion, collaboration and eventually, irresistible clout before these jokers get the memo. they are amply overpaid not to, and 'anything but' goes.


'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Mon May 30th, 2011 at 08:07:59 AM EST
[ Parent ]
international involvement in tax collection

This is insane squared. What is this supposed to mean in practice? Foreign tax collectors, foreign tax evader detectives, foreign tax authority bureaucrats?

This is pretty much an explicit call to plunder the country.

Precisely. As I said in the Salon, you can undo pay cuts and modify labour laws again, but sold-off assets are difficult to recover.

Tonight, after the huge (and unreported) demo at Syntagma today

I saw it in the morning news, though the number given was IIRC 20,000 people.

*Lunatic*, n.
One whose delusions are out of fashion.

by DoDo on Mon May 30th, 2011 at 01:49:08 AM EST
By the way, this would be fun to see in Portugal.

Here, the strategy of the right (and partially of the socialists) has been essentially to support business tax-evasion (as opposed to wage slave tax evasion - impossible in that case).

Proper tax collection (towards business) is anathema to the right here. It would be curious, to say the least, to see the dynamics of a EU mandate on proper tax collection towards business.

by cagatacos on Mon May 30th, 2011 at 02:05:18 AM EST
[ Parent ]
On the contrary, sold off assets are precisely as easy to recover as surrendered labour rights. Arguably easier.

See, e.g., the Sakhalin gas field.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 30th, 2011 at 02:40:55 AM EST
[ Parent ]
Is it? And what is the price? You sell cheap (being in trouble) you buy latter expensive. And with interest rates high. ..

Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Mon May 30th, 2011 at 10:49:05 PM EST
[ Parent ]
"Buying" implies that you intend to pay someone.

There's this thing about land ownership, lottery concessions and so on - it only exists because the state says so. And the Greek state has no reason to say that land ownership, lottery concessions, etc. granted under duress is valid once it is no longer under duress.

So the exchange goes something like this:

Greek prime minister: "We have a solid majority in favour of renationalising the Acropolis."

Foreign oligarch: "Tough. We own it now."

Greek PM: "You sell it back for cheap, or you wake up one fine morning to a 500 per cent per year 'national monument maintenance and restoration tax' on the estimated value of national monuments of peculiar historical interest. Your pick."

Foreign oligarch: "We'd sue in the European courts."

Greek PM: "And we'll pay the fine in Drachma. At the official exchange rate."

Foreign oligarch: "... Fuck."

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 30th, 2011 at 11:46:53 PM EST
[ Parent ]
Oh I mean later ...this computer spelling...
Yeah but it's not very popular to nationalise and confiscate when you pretend to be democratic government...


Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Tue May 31st, 2011 at 07:47:13 PM EST
[ Parent ]
Under the circumstances, that is like saying that it is not nice for you to ask the police to get back the money you withdrew from the ATM while the robber had a gun in your back.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue May 31st, 2011 at 08:11:47 PM EST
[ Parent ]
Ah that kind of thinking is for those with "rational" thinking.
This world operates other way, ha-ha. Once you as a state have nationalisation you are doomed...there is no trust and you will hardly see any investors for a long, long time.


Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Tue May 31st, 2011 at 09:00:54 PM EST
[ Parent ]
That is not the Russian experience.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Tue May 31st, 2011 at 11:54:33 PM EST
[ Parent ]
Maybe not right now (all tho I think foreigners are scared a little bit) but it took some time. And even now we do not know exactly who the fuck are those ballooners in Russia? And whoever they are they can disappear over the night...One can say it is risky at least to invest in Russia...
My family (along with many in Serbia) went through nationalisation and confiscation after WWII in Tito's Yugoslavia. That definitely killed my grandparents ( and many more) and I would not recommend it. It starts "naively" but then one cannot see the end. If there is one thing that I appreciate in western culture it is "holiness" of private property. It is the other matter that state should be able to regulate how wealth should be spread amongst citizens.


Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Wed Jun 1st, 2011 at 12:51:01 AM EST
[ Parent ]
Every situation is unique unto itself. Not to minimize the fact that Greece has an oligarch problem and other problems. But the situation could be played. It would be transparently obvious that Greece is being looted if such "privatizations" occur in the context of "requirements" for getting "loans" that, were the ECB acting like a central bank, would be called "quantitative easing" or would simply be provisions of liquidity to relieve a crisis.

It beggars belief that just crediting the Greek central bank with €50 billion would create inflation in Greece, given the unemployment levels in Greece and given that it would mostly be used to pay foreign banks. It they think making those payments to those banks will create inflation in the bank's home countries, well, perhaps they would prefer default.

Given those realities, it is transparently obvious that the ECB/DB/German approach to monetary policy is similar to JP Morgan's desire to convert back to a gold standard in the USA after the Civil War. With declining gold production from US mines, much of which was in Morgan vaults, a adopting a gold standard essentially meant deflation, due to a contracting money supply, which meant that Morgan's gold was ever more valuable. Going concerns across the US had loans in $US. This just made those loans much more difficult to pay. Guess who ended up with lots of those business -- those who had the gold. William Jennings Bryan was describing things pretty accurately when he likened the process to mankind being crucified on a cross of gold. The ECB is demonstrating that it is not necessary to have a gold standard to accomplish the same thing.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jun 1st, 2011 at 01:35:00 AM EST
[ Parent ]
Maybe not right now (all tho I think foreigners are scared a little bit) but it took some time.

Not that long. Oh, sure the Brits pissed and moaned for a while after they had their corrupt Yeltsin-era contractors curbstomped. But fuck the Brits, they weren't contributing anything useful anyway.

And whoever they are they can disappear over the night...

Investors can't move capital around "overnight." People can move money around overnight, but only if the central bank says you can.

Having a floating fiat currency does that for you.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Wed Jun 1st, 2011 at 05:19:36 AM EST
[ Parent ]
..you will hardly see any investors for a long, long time.

Isnt' that suppose to be about the yield? In a market economy capital will be allocated there where it gets profit?
Oligarchs are not investors. Greece will benefit greatly if they leave.

by kjr63 on Wed Jun 1st, 2011 at 05:41:36 AM EST
[ Parent ]
As a culture, we need to stop conflating investment and speculation. Unfortunately ketchup economics sees no difference.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Wed Jun 1st, 2011 at 06:10:05 AM EST
[ Parent ]
Even speculation may have positive effects to some degree. I prefer the term "rent-seeking."
by kjr63 on Wed Jun 1st, 2011 at 08:46:59 AM EST
[ Parent ]
It's hard to tell which is which until it's obvious...usually too late...

Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Wed Jun 1st, 2011 at 06:21:41 PM EST
[ Parent ]
One thing about Greece: it's government regulations and bureaucracies are so labyrinthine that it hardly receives any foreign investment at all. This was the case BEFORE the crisis.
by Upstate NY on Wed Jun 1st, 2011 at 10:43:45 AM EST
[ Parent ]
DoDo:
international involvement in tax collection

This is insane squared. What is this supposed to mean in practice? Foreign tax collectors, foreign tax evader detectives, foreign tax authority bureaucrats?

but hasn't this always been the rear end of the euro common currency horse? wasn't it inevitable that eventually we'd have to have that? seems unrealistic to expect otherwise...

point being who leads the superstate, we've had the candy of convenience (the E) and the flowers of freedom (schengen), now comes the quid pro quo.

if we do it wrong, it's date rape, if we do it right it may be a lot fairer and efficient than what the PIGs are humilated by now.

standing in a line at a bank here in italy, i once heard a 'statale' (civil servant, taxed directly at paycheck), ranting how the folks like him are having to shoulder the burden of financing the state, while furriers sport in yachts declaring losses. it was interesting how everyone else in the line suddenly found their own shoes fascinating objects of contemplation. you could have cut the vibe with a knife, and the 'great divide' was in naked view.

italy is a poster child for this syndrome, and it creates huge friction and inefficiency. for example if an architect comes in to the comune with a building plan, he is treated like a shyster, immediately suspected of under-reporting profits or doing cash deals, and the only revenge they can take is by becoming as constipatedly recalcitrant as they can, that'll teach 'em... bureaucrats' revenge.

aaagh, it really gums up the works something ghastly.

if euro-wide fiscal centralisation were employed enough to reduce the under-the-table economy by even a third, (especially the organised crime element), italy would be a wealthy country, as i suspect would spain, portugal and greece. it would cut out a lot of grifter middlemen, and one suspects the whole shebang would be run better and more equitably from brussels than rome.

this would be controversial, to put it mildly, the UK may entirely peel off, but their dowry has so much funny money in it anyway. it goes against the regionalist movement that's gaining power here big time, but the ones who'd squeal the loudest would be the ones who have the most to lose from europeans all being taxed fairly and efficiently anyway, making the job of closing them easier.

many here affirm the main reason for berlu's voterbase popularity is his own aversion to paying taxes.

i would imagine the strongest objections to euro-wide fiscal network will come from the dutch not wanting the germans or the french or vice versa not being privy to each others' moneygames, not from the PIG countries, but i'm guessing here. i wonder if there any reputable polls about the eurovolk's feelings about this.

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Mon May 30th, 2011 at 08:38:07 AM EST
[ Parent ]
standing in a line at a bank here in italy, i once heard a 'statale' (civil servant, taxed directly at paycheck)

You mean you have ordinary workers (as opposed to small businesses etc) who aren't taxed directly at paycheck?

No wonder yo have high rates of evasion.

by IdiotSavant on Tue May 31st, 2011 at 08:19:29 AM EST
[ Parent ]
yup, salaried workers get docked prepaid, but it's the multitude of 'unofficial' enterprises/independent contractors, and the double-accounting, lack of receipts and part of the pay declared and the other not, that 'statali' cannot avail themselves of, and incurs their rage.
before they contained themselves more, being able in some cases to retire in their 40's with a pension of E1,000 p.month or so, and free to pursue another career, 'official' or otherwise...

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty
by melo (melometa4(at)gmail.com) on Tue May 31st, 2011 at 01:18:04 PM EST
[ Parent ]
Eurointelligence Daily Briefing: An unprecedented loss of sovereignty (30 June 2011)
News reports out this morning suggest that this week's agreement on Greece will include an unprecedented loss of sovereignty; all key aspects of the agreement are still under dispute; proposal is for a €60bn package, with loans of €30-35bn; a special eurogroup meeting is scheduled for next Monday; IMF denies news reports that the Troika report will declare the failure of the Greek reform programme; Bild has dispatched reporters to report from pre-revolutionary Greece; Lorenzo Bini-Smaghi tells the FT that a Greek restructuring would be like the death penalty; Wolfgang Münchau argues that the choices on Greece boil down to eurozone exit or conditional roll-over: soft options are not available; after Greece, Ireland also needs another programme; Claus Hulverscheid criticises Jean-Claude Juncker `s loose talk about Greece, and effectively calls for his resignation as eurogroup chief; Christine Lagarde's accession to the IMF is all  but a done deal;David Marsh lists four reasons not to nominate Lagarde; S&P does not expect stress tests to change its bank ratings; the IMF, meanwhile, calls for tougher capital requirements for systemically relevant financial institutions.
(Google link)

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 03:50:29 AM EST
Wolfgang Münchau on the IMF

In his FT column, Wolfgang Münchau says the disagreement between the IMF and the EU over the future funding policy for Greece has one good aspect. It ends the illusion of half-hearted soft options like reprofiling, or soft restructuring. We either have to roll over - and keep on doing so - or choose a hard default. The latter would almost invariably lead to a Greek exit from the eurozone. He expects the European Council  to reach a decision to roll over at the June summit , which would be just in time for the IMF to release the next tranche of the existing loan. For the time being, the name of the game is to keep the Germans and the Dutch calms, the True Finns out, and the Greeks in.



Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 04:03:46 AM EST
[ Parent ]
This is bizarre even from the EU/ECB/German perspective. They are forcing the Greek government either to make a stand and default, possibly leaving the Euro, or go down history as a quisling government, incapable to even do the dirty work that is assigned to them.
The EU/ECB/German perspective has been insane all along. It's just becoming more and more patently clear just how much.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 04:16:30 AM EST
It could be yet more of a weird kabuki dance. They are trying to push Greece as much as possible to break and be done with it. This would explain the bizarre new plans. The European media has done a rather poor job of sticking to the details. It has been reporting all manner of inaccuracies about Greece's austerity package and what it entails. Greece signed on originally to sell $7 billion in assets by 2015, and now each step of the way, we hear Greece is not complying with their austerity package. The changes have come repeatedly. Greece must sell 15 billion by 2012. Agreed. Greece must sell 50 billion by 2015. Agreed. Greece must sell a lot more than that (Ollie Rehn). Greece must sell 300 billion (Stark). Greece must establish a fund controlled by non-Greeks. Greece must give over assets as collateral. Greece must have an external tax collections agent. After Greece agrees to all of this, one wonders what is next?
by Upstate NY on Mon May 30th, 2011 at 09:27:34 AM EST
[ Parent ]
Yannis Varoufakis: When push comes to shove? Exposing the incredible threat of Greece's forced exit from the eurozone
... even if the Greek government were thus convinced to bite the bullet and start the exit process, the result would be a most definite unravelling of the eurozone. The reasons are evident to anyone prepared to simulate in their mind the train of events that will follow such a decision.

...

Of course, none of the above prove that Germany and the rest of the surplus countries will not, at some point, decide that they want to cut Greece off; that they are no longer prepared to share the same currency with the likes of Greece et al.

But if they choose to jettison Greece from `their' monetary system, the only sensible way in which to do it is by opting out of the euro themselves. In other words, rather than lean on Mr Papandreou to make his grave announcement to Greek parliamentarians on some bleak Friday afternoon, it is Mrs Merkel who will take the initiate (perhaps in association with like minded governments in Austria, Finland and Holland) and declare Germany's exit from the euro.



Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 05:08:34 AM EST
Why is nobody considering the possibility of issuing a local-currency/scrip/"greenbacks" without formally exiting the Eurozone?

Greece could, over a weekend, instruct its banks to set up accounts in ND while retaining existing Euro accounts. ND would start out at the exchange rate with the Euro on January 1, 1999, but float thereafter. ND notes could be printed. Both Euros and ND would remain legal tender in Greece. The government would announce that it would redenominate all its domestic obligations to ND at the initial exchange rate. Capital controls (tax on outflows, and border controls) would be instituted to retain the greece economy's existing Euro reserves as a backing for the ND.

Because of Gresham's law, ND would circulate extremely fast compared to Euro cash, which would be hoarded. In fact, were Germany do attempt to issue New-DM, the New-DM would be the one that would not circulate, being perceived as more valuable than the Euro by the German public. Gresham's law is funny that way.

The least disruptive wa yout of the European currency crisis is for deficit countries to issue local currency à la Wörgl without formally exiting the Euro, and to institute capital controls. After all, France and Denmark have already temporarily suspended Schengen so what's the big deal with temporarily taxing capital flows?

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 05:26:22 AM EST
[ Parent ]
  resorts to "Make-their-own-competing-currencies" wasn't foreseen and ruled out from the first?  That would surprise me--even from a bunch of folks like the E.U. executives whose lack of foresight is astonishing.

ECB  Article 105a ?

   "In all Member States but the United Kingdom, the NCB has the exclusive right to issue banknotes." (36)

   does it matter if they're called "script"?

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Mon May 30th, 2011 at 11:53:06 AM EST
[ Parent ]
  link-y link:

     http://www.ecb.int/pub/pdf/other/bnlegalen.pdf  

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Mon May 30th, 2011 at 11:54:51 AM EST
[ Parent ]
Doesn't mean that the banknotes have to be Euros, does it?

It says the National Central Bank, not the European Central Bank.

Also, the government can issue its own IOUs. Any bearer credit instrument accepted by a third party can be used as money.

Also, another argument I usually give against this monopoly of money issue is that, by the time the case makes its way through the European Court System and Greece is slapped with a fine, either Greece will be solvent again or the EU will no longer exist.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 11:58:45 AM EST
[ Parent ]
The right article is
Article 128
(ex Article 106 TEC)
1. The European Central Bank shall have the exclusive right to authorise the issue of euro banknotes within the Union. The European Central Bank and the national central banks may issue such notes. The banknotes issued by the European Central Bank and the national central banks shall be the only such notes to have the status of legal tender within the Union.
(CONSOLIDATED VERSION OF THE TREATY ON THE FUNCTIONING OF THE EUROPEAN UNION [PDF])

So, the monopoly of issue applies only to Euro notes and that something is not legal tender doesn't mean that it cannot be generally accepted.

So Greece could create a new unit of account called the New Drachma. It could redenominate all obligations between Greek counterparties in the new unit of account. It could issue certificates in denominated in the new unit of account. None of this violates the letter of the article.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 12:16:18 PM EST
[ Parent ]
   Wow.  Okay then.  

   Hmmm.  I see I don't have enough CHF, since I still have some Euros left.  

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Mon May 30th, 2011 at 12:38:36 PM EST
[ Parent ]
They could also formalize barter-exchange systems such as the BX system in the USA.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon May 30th, 2011 at 01:51:48 PM EST
[ Parent ]
Why doesn't Greece just default and let others try to kick it out of the EMU. And meanwhile, start a state bank, backed with all of the assets the ECB is demanding they "privatize", and issue local currency, commission public works, make loans for farmers and businesses which will make domestic consumables, etc. paid in the local currency. By requiring tourists to make payments in local currency they would get "hard" currency. They then should institute protective tariffs for domestic agriculture and industry -- The American System, a la Henry Carey's Harmony of Interests political economy.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon May 30th, 2011 at 01:45:53 PM EST
[ Parent ]
Yannis Varoufakis: A New Versailles Treaty Haunts Europe. (And this time it is not just me thinking so...) (21 November 2010)
The gist of the Versailles Treaty was not so much that it punished Germany and caused Germans untold collective pain but that, in the end, it was an own goal; a terrible deal even for the victors; an own goal that John Maynard Keynes had anticipated and the rest of world came to recognise when it was too late, in the 1930s. My conclusion was thus: ...turning countries like Greece into sundrenched wastelands, and forcing the rest of the Eurozone into an even faster debt-deflationary downward spiral, is a most efficient way of undermining Germany's own economy. Assuming, for argument's sake, that Greece is getting its just deserts, do the hard working Germans deserve a political elite that quickmarches them straight into economic catastrophe?


Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 07:18:37 AM EST
I continually read phrases like "This is insanity" oe "We should do this ... do that" when in fact the only question that I have is "What is the end-game of the people who count, the ultra-wealthy who pull all the significant strings behind the scene?" Ask yourself this: Who is insane, the billions of people treated like cattle who can't recognize their demise or the overlords sitting on their fats asses overseeing the upcoming ... whatever?

Emigration? In other words, RUN!!! To where? You got another planet in mind?

We're all Palestinians waiting our turn, get used to it. Glad I'm old and won't live to see the worst of it.

They tried to assimilate me. They failed.

by THE Twank (yatta blah blah @ blah.com) on Mon May 30th, 2011 at 08:38:36 AM EST
It doesn't look like the endgame is rational for the overlords.

Best said in Bob the Angry Flower's Classic Literature sequels: Atlas Shrugged 2: One Hour Later



Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 08:55:36 AM EST
[ Parent ]
I suspect a new pyramid will form: A couple hundred (if that many) at the tippy top, the workers (engineers, doctors, nurses, scientists, etc) along with the military ... you'll still have one oligarch trying to poach the resouces of another ... in a tiny "middle class", and that will do it. For the sake of the planet I hope it works out that way. Good bye global climate change, no need for elections, lawyers, etc. Just got to get rid of the masses ... and that seems to be the game plan. I just wish a Dick Cheney would come out and admit it. The final "Thrilla in Manilla" ... Israel takes on China. Hell of a final war.

They tried to assimilate me. They failed.
by THE Twank (yatta blah blah @ blah.com) on Mon May 30th, 2011 at 09:56:55 AM EST
[ Parent ]
Nah, you'll end up with the middle class doing ok, the middle income group being spread out over the planet and the low income group similarly spread out.

Hell, you might even get an increase in overall welfare if the real global poor get raised up even a little. There's far more of them than there are of the Western middle income group.

by Colman (colman at eurotrib.com) on Mon May 30th, 2011 at 10:01:08 AM EST
[ Parent ]
At what point did people think that the throwing-virgins-into-the-volcano thing was a fucking joke?

The overlords are not medium term rational.

They're focused entirely on the very short term, in the main. Hell, most of them are highly dysfunctional people. Though most of them probably didn't start that way: seven years in the world of the overlord will make you dysfunctional by any normal standard.

by Colman (colman at eurotrib.com) on Mon May 30th, 2011 at 09:59:08 AM EST
[ Parent ]
If they haven't realized it by now, they ain't gonna realize it.  At this point, we're basically talking about Greece either defaulting, or selling off anything that isn't nailed to the floor (and not a few things which are) paired with another round of austerity.

Be nice to America. Or we'll bring democracy to your country.
by Drew J Jones (pedobear@pennstatefootball.com) on Mon May 30th, 2011 at 10:29:49 AM EST
[ Parent ]
  I never considered it a joke, certainly not since April 20, 1914, anyway.

   What I really don't understand is that there are regulars here who, having read the sign above the door,  "Capitalist Cafe"  (and the note on the menu, "Diners Eat At Their Own Risk"), chose, nay, insisted, to stay and order anyway.

   That's the part that puzzles me, frankly.

    From the first, I've had it very clear in mind what sort of people have the levers of control and what they (obviously) intended and still intend to do with them.

    You?

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Mon May 30th, 2011 at 01:03:01 PM EST
[ Parent ]
 
BTW,

 RE:
   "having read the sign above the [restaurant] door,  "Capitalist Cafe"

   is not to be read as a reference to Eurotrib; it's, instead, a metaphor for Capitalism(s) as they have been (mainly) practised at least since the Gilded Age--or, that is, the 16th century.  ;^)

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Mon May 30th, 2011 at 01:32:26 PM EST
[ Parent ]
That's the world we live in.

You?

by afew (afew(a in a circle)eurotrib_dot_com) on Tue May 31st, 2011 at 04:26:48 AM EST
[ Parent ]
  No, the world we live in is and always has been faced at repeated junctures with decisive choices for nations of people to make in concert; one such was the matter of the Lisbon Treaty, already rejected democratically and brought back by people who refused to respect law or procedure.

   Instead of rejecting their attempts as in the previous instances, people allowed themselves to be railroaded.  In the world we live in, this can happen, but to imply as you do that that's just the way it is and has to be--no, I reject that.  Otherwise, you may as well just shelve notions of democracy now and surrender to autocratic rule.

   The world we live in leaves us choices and they are important; you offer a cop-out and I'm not buying it.

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Tue May 31st, 2011 at 07:03:58 AM EST
[ Parent ]
The world we live in leaves us choices and they are important;

Yeah right but the only way to make your choice is to die for it (like those people in Middle East right now). It may be worthy in a long run but I am not sure any more...I once thought it is but my view changed radically...
 

Science without religion is lame, religion without science is blind...Albert Einstein

by vbo on Tue May 31st, 2011 at 09:52:10 AM EST
[ Parent ]
 RE: "Yeah right but the only way to make your choice is to die for it (like those people in Middle East right now). It may be worthy in a long run but I am not sure any more...I once thought it is but my view changed radically..."

  (in my opinion)

    Fortunately, that's not true except in what is, relatively speaking , `the very last resort.'  So, while, yes, unless people choose and act responsibly sooner, you're probably correct in pointing out that eventually the situation worsens to the point where the only effective avenues left are life-threatening ones.

    Hence, indeed, my emphasis on opposing now the view, very dangerous, in my opinion, that "That's the world we live in" can be an acceptable response to my earlier point:

   

   What I really don't understand is that there are regulars here who, having read the sign above the door,  "Capitalist Cafe"  (and the note on the menu, "Diners Eat At Their Own Risk"), chose, nay, insisted, to stay and order anyway.

   


   I've certainly made this argument before in threads in Eurotrib.   In essence, besides being simply a sheer fatalist resignation, the reply "That's the world we live in" simply begs the question which is the very  point:  "Why should it be the world we live in and why shouldn't people act in concert to change that fact, if it's a fact?" --

    Everything that was, was once part of "the world we live in" until people determined to make things different.  

    Socially, for some time--a time which I'd very roughly place around the advent of wireless radio and the talking motion picture--society's progress toward real effective democratic practices, other than in mainly cosmetic ways, has been halted and reversed so that now we are trending back to the ways of life which are Medieval.  A world of dazzling technology masks this tendency for the vast majority of people who find it difficult to imagine that they might live lives which are technologically very advanced and at the same time, from a moral, social and political point of view, have more in common with  feudalism than with the high-water mark of the European Enlightenment.  It bears keeping in mind that the Enlightenment (which, like all intellectual movements had its flaws in reasoning and mustn't be worshipped uncritically) was from the very first a movement directly, deliberately and fiercely opposed by anti-Enlightenment thinkers who not only have their adherents today, but those contemporary forces of the anti-Enlightenment have positively captured the initiative and put liberal democracy not just on the defensive but on the immediately endangered-species list.

      The current, unstated objective, it seems to me is to reverse and eliminate as completely as possible the progress which liberal democracy has made over four centuries and to return to what amounts to a modern version of feudalism.   The serfs will dress, act and behave very differently from their Medieval counterparts, they'll live in a world technologically very different, but their actual opportunities for lives lived at their own direction and according to their own values will resemble what the feudal lords once allowed serfs.  This is all the more ironic as it is being done with what I suppose is  the largely unwitting help of millions who think they're marching under the banner of the author of The Road to Serfdom, one of their ideological heroes and one of the few which many of the non-specialist public has read.    But there have always been leading thinkers in that camp; philosophers, poets, artists, who were intellectually aligned with the earliest leaders of anti-Enlightenment opinion.  

  Behind all the controversy which is manifested in divisions over "globalization," "free-market capitalism" versus socialism, public versus private corporate control, etc. are the basic issues with roots in religious belief and the proper sources of worldly authority.  There are economic aspects of the most far-reaching kind, but there are others no less far-reaching which concern technology, social mores, collective versus individual rights, the value of art and literature, not to mention the stewardship of the natural, non-man-made world and how these resources should be managed and allocated.

If one accepts that we are here mainly to suffer and work, and to respect our subordinate place before God's dominion, then that's going to influence importantly whether one is resigned in the face of daunting forces which seem nature-and-God-given.     By this view, people who aren't "thrifty" simply "deserve" the corrective hardship which penury eventually imposes.

 While much has already been lost or seemingly lost, an immense store of cultural heritage remains under threat of very well organized forces who have never thought it was a good idea to actually consult the governed as to how their governors should behave.   Among democracy's defenders there is supposed to be found a good many people who think of themselves as  political "conservatives"; but in fact, among these there are apparently a great many who mistakenly give all their practical support to the forces of reaction, those trying  their best to take us further back toward the new feudalism.

   Opposing the thinking and the unthinking-assumptions which make that possible has to be a very high priority for those of us who don't want to wait until the only avenues remaining are the ones which mean violent resistance and the risks to life that it requires.


"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Tue May 31st, 2011 at 11:08:28 AM EST
[ Parent ]
I have made the point that the whole "modern" project since the Renaissance has been one of first carving out a space safe from the depredations of capricious and arbitrary nobility in which business could operate to one now in which the very wealthy and the bankers through which they operate are the new nobility, de facto, if not (yet) de jure, above the law.

This has been accomplished via the elevation of the needs of the economy over those of the society, which reliably leads to the economy eating the society, as we are now witnessing. But this does not mean that markets are not valuable in and of themselves. We just have to exercise some discretion as to what we allow markets to handle. We have only occasionally and fleetingly demonstrated an ability to do this.  

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue May 31st, 2011 at 12:21:51 PM EST
[ Parent ]
I would add that the odd part of your formulation (which I agree with) is that the Renaissance and the Enlightenment were situated on the preeminence of reason. To a large degree, I think the emphasis on reason (and its concomitant conceptual units: global contexts, ideology, etc.) are used to do the aristocracies bidding. Homo Economicus is one upshot of Enlightenment thinking.
by Upstate NY on Tue May 31st, 2011 at 01:52:48 PM EST
[ Parent ]
  Those (yours and that of ARG above) are excellent observations.

   "To a large degree, I think the emphasis on reason (and its concomitant conceptual units: global contexts, ideology, etc.) are used to do the aristocracies bidding. Homo Economicus is one upshot of Enlightenment thinking."

   Exactly.  And maybe in these your point out the most serious failing in the main course of Enlightenment thought.  The anti-Enlightenment thinkers used reason and, more especially, a (literally) sophisticated form of rationality to try and undermine the foundations of Enlightenment's program, which sought emancipation from all-powerful state or church authority, the freedoms to question these and to better fulfill certain precepts of justice and charity which suffered under arbitrary rule.

   Enlightenment's ramparts were not soundly built and attacks on them were, perhaps inevitably, effective to some extent.  Perhaps the flaws were more flawed in economics than in any other realm, it being in a still-young discipline as a field of formal thought.  Unfortunately, as society advanced technologically, economics has come to take on a greater, more all-important and central place.   In a society whose practical daily religion is consumption, economics becomes the realm of the priesthood and its high practitioners priests.  The Enlightenment thinkers did not foresee such a development, perhaps because they assumed that economics would remain a part of moral philosophy where it might be supposed to remain subject to humanist values which tempered strictly formal rational logic which, without direction-giving  humanist principles, can easily lend itself to moral social-horrors which became familiar with the industrialization of Britain, the rise of mills and machine-produced manufacturing.

   Having become a fully-fledged quantitative pseudo-science, economics is no longer even obliged to make a polite nod in the direction of humanist moral principles; it even presumes to over-rule them in the name of efficiency.

   So, without having disturbed the basic ground of intellectual enterprise, anti-Enlightenment thought has at length succeeded in turning the tables on the basic prevailing assumptions which came from  Enlightenment thinkers.

   This is why, unless and until some rather important strides are made in a better general recognition of how and why Enlightenment thought was mistaken and vulnerable, the prospects for correction and recovery--intellectual correction of erroneous assumptions and moral recovery from a now un-anchored drift--are not good.  Whether this work has to pass first by academic ranks before getting out into the realm of the general public is an open question.  But unless some of it goes on in academic circles, the sterile conflicts of liberals versus conservatives in academic politics and economics will go on and on--that is, without sparking a salutary movement into the popular consciousness--won't they?

   Thus, we (i.e. some, those concerned) are going to have to correct and repair some major mistakes in the conceptual foundations on which the intellectual world has been built since the Enlightenment.  And throughout this, those committed to the status quo ante-Enlightenment are going to vigorously resist that effort.

    That ours is now a video culture and not a text-based culture makes this work immeasurably more difficult, lending that same degree of helpful confusion to opponent forces.

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Tue May 31st, 2011 at 02:47:08 PM EST
[ Parent ]
Whether this work has to pass first by academic ranks before getting out into the realm of the general public is an open question.  But unless some of it goes on in academic circles, the sterile conflicts of liberals versus conservatives in academic politics and economics will go on and on--

Academia is possibly the least fruitful area from which to expect progress. The "power disciplines", economics and political science in particular, are thoroughly captured by corporatists. The problem with the Enlightenment, so called, has always been that it was an affair of the elites. As the franchise was extended further down the social hierarchies enlightenment values became less and less significant. In the USA this was especially true where there was conflict with religion.

I think one of the most fruitful avenues for change is amongst financial professionals, especially those who are independent of and in conflict with the TBTFs. They might not always be the most "enlightened" on social issues but they are acutely concerned with what works and with understanding how things operate. Work, such as that by Steve Keen, which demonstrates how models can be built that emulate a multi-sector economy with monetary flows which yield results strikingly similar to recent history could appeal to them.

Missionary work amongst this group could yield results. To be successful it would be necessary to construct narratives that transform their libertarian and gold buggy understandings by conceding criticisms of current approaches but showing the limitations and past results of gold standards, such as in post-Civil War USA, while showing how alternatives, such as Modern Monetary Theory can help. But most are un-moderated sites, so a thick skin is a requisite.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue May 31st, 2011 at 03:34:39 PM EST
[ Parent ]

  thank you!  That's a very interesting site!--not that I could post there, but as a source to read, very interesting.

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge
by proximity1 on Tue May 31st, 2011 at 03:59:53 PM EST
[ Parent ]
Seems to me that you must be young person ( or young in heart, ha-ha).I am not that optimistic and if there is a hope I would agree with Argeezer...
If anything can help that would be "Enlightenment" for those in charge that this economic situation is just not going to work in a long run. But trouble is they behave like there is no tomorrow...


Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Tue May 31st, 2011 at 08:50:02 PM EST
[ Parent ]
"What is the end-game of the people who count, the ultra-wealthy who pull all the significant strings behind the scene?"  

That's the ONLY relevant question...and that ONLY can lead to some answer to this insanity that goes on and will go on...actually it just started.
Until we have answer on this question I assume there will be more and more protests around EU and the World (I wonder what Americans are waiting for?") And we'll see violence Middle East style everywhere... They are not going to go down quietly...I feel sorry for generation of our children...


Science without religion is lame, religion without science is blind...Albert Einstein

by vbo on Mon May 30th, 2011 at 11:26:37 PM EST
[ Parent ]
You want to know what struggling Americans are doing?

This is an article on the no-man's-land between the poor and the working poor.

Supposedly, when you're working you're empowered, but the system is such that one can feel oppressed simply for giving a shit.

http://www.buffalonews.com/business/article437912.ece

"Peach said she enjoyed being part of the work force, preferring to earn a living over collecting welfare because work "gives life meaning and value."

But she realized she was better off financially when she was on welfare. "I didn't have to worry about how I would pay rent, the bills or buy food. I had economic security."

by Upstate NY on Tue May 31st, 2011 at 11:34:48 AM EST
[ Parent ]
Oh my God! An architect with master degree earning $ 30000 and 52 years old going back to school to find better job (having $26800 in her previous "uneducated" job). How long she expects to live and does she realise that she will need to pay back for education. People are delusional.USA is a grim place. I really cannot understand that culture of suffering quietly in the name of what? Working people in USA are robed big time and they do not even understand what's happening to them. Oh and I just love those conservatives with their "brilliant" ideas. To make more low paid jobs available so that people can work even 3-4 jobs to survive. Where is the outrage?  

Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Tue May 31st, 2011 at 08:13:47 PM EST
[ Parent ]
The outrage is present and growing.  It hasn't found it's proper focus ... yet.  

She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre
by ATinNM on Tue May 31st, 2011 at 09:05:00 PM EST
[ Parent ]
rapped in a flag, blessed by Jesus and stuffed down their throats 24/7.
by Euroliberal on Wed Jun 1st, 2011 at 01:37:02 PM EST
[ Parent ]
Atrios:

How About The Keys To The Acropolis

Give us everything that isn't nailed down, much of what is, completely destroy your economy, and maybe, just maybe, we'll do you the favor of bailing out our banksters.



Be nice to America. Or we'll bring democracy to your country.
by Drew J Jones (pedobear@pennstatefootball.com) on Mon May 30th, 2011 at 10:32:04 AM EST
Makes you long for the days when the Ottomans used the Parthenon to store gunpowder so it got accidentally blown up...

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Mon May 30th, 2011 at 11:30:10 AM EST
[ Parent ]
'T was no accident, it was pillage by leaders from a corrupt italian republic, aided and assisted by germanic expertise.

Parthenon - Wikipedia, the free encyclopedia

In 1687, the Parthenon suffered its greatest blow when the Venetians under Francesco Morosini attacked Athens, and the Ottoman Turks fortified the Acropolis and used the building as a gunpowder magazine. On 26 September a Venetian mortar, fired from the Hill of Philopappus, blew the magazine up and the building was partly destroyed.[48] Morosini then proceeded to attempt to loot sculptures from the ruin. The internal structures were demolished, whatever was left of the roof collapsed, and some of the pillars, particularly on the southern side, were decapitated. The sculptures suffered heavily.

Parthenon - Wikipedia

Den 26 september samma år bombarderade artilleri, under den svensk-tyske fältmarskalken Otto Wilhelm Königsmarcks befäl, byggnaden och den exploderade delvis.

Francesco Morosini - Wikipedia, the free encyclopedia

Not satisfied with the destruction he had wrought so far Morosini tried to loot Athena's horses but the attempt resulted in the masterpieces being smashed to bits on the rock below. The Ottoman Empire regained possession of the monument in the following year and having noticed the demand began to sell souvenirs to Westerners.


Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se
by A swedish kind of death on Mon May 30th, 2011 at 12:37:22 PM EST
[ Parent ]
Actually it's just the opposite. Oligarchs don't care a bit about "mobile" stuff. Real wealth wears out and have to be replaced and labour employed.
Land and rents are there forever. That is valuable that does not need nailing. Water, islands, real estate, roads, energy etc.
by kjr63 on Mon May 30th, 2011 at 01:00:51 PM EST
[ Parent ]
I was going to put that here.. you beat me...
Brilliant atrios as always.

A pleasure

I therefore claim to show, not how men think in myths, but how myths operate in men's minds without their being aware of the fact. Levi-Strauss, Claude

by kcurie on Tue May 31st, 2011 at 07:02:34 AM EST
[ Parent ]
is as mysterious as that of the Irish government. In both cases one gets the impression of bumbling compradors, out of their depth and confused. But can that really be?
by rootless2 on Mon May 30th, 2011 at 02:56:55 PM EST
Greece has a foreign primary deficit and a structural import dependency on food and fuel.

Or, in simpler terms: No hard currency, no dinner. So the Troika has leverage over them.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 30th, 2011 at 03:07:56 PM EST
[ Parent ]
Yes but both come with a caveat: Greece has no problem with supplying the grid. It has plenty of spare fuel (the dirtiest possible: lignite, but under the circumstances I'm sure that even the Greens would have no problem with a limited period of emergency full use) and the power plants to feed it to. Solar water heater use is at 90% levels. That is beyond the possibilities that wind and wave power offer.

It also, as far as I have managed to see, has no problem with calories produced locally if it pretty much stops exporting food for a while. If it goes on a crash program of converting the vast acreage of CAP subsidized cotton fields and the remaining tobacco fields to producing foodstuff, I think it will manage. This would imply rationing at least for a while.

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Mon May 30th, 2011 at 06:45:44 PM EST
[ Parent ]
That's good. Means the Troika don't have you quite so much over a barrel.

Liquid fuel's gonna be a problem, though, particularly with all those islands connected by boat.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 30th, 2011 at 06:50:26 PM EST
[ Parent ]
There are probably still a good number of sail boats about, and, while most have a small motor, people can learn to minimize the use of the motor. Indeed, under those circumstances there might be a resurgence of sail powered water transport for internal distribution in Greece. If such measures as Talos mentioned, along with a local currency, were undertaken the biggest danger for The Powers That Be could be how clearly it is demonstrated that so much of the existing system exists only for the benefit of capital and the bankers who control it.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon May 30th, 2011 at 07:16:23 PM EST
[ Parent ]
Well, a crash mining programme and rapid conversion of a substantial fraction of your agriculture from cash crops to food crops are both non-trivial exercises with a real risk of failure.

And failure is something you can ill afford when you have brownshirt militias breathing down your neck.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 30th, 2011 at 07:34:48 PM EST
[ Parent ]
Aha. Not an unusual problem: brownshirt militias breathing down your neck.
by rootless2 on Mon May 30th, 2011 at 07:36:29 PM EST
[ Parent ]
non-trivial exercises with a real risk of failure.

Failure would almost be guaranteed unless the government insured success. It would be an opportunity to see if there are any left who can organize a socialist economy. It would be little different from going onto a war footing. All of the current economic orthodoxy would have to be trashed, or, properly, recognized for the trash that it is.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon May 30th, 2011 at 09:12:41 PM EST
[ Parent ]
Failure would almost be guaranteed unless the government insured success.

Yes, but this involves engineering challenges, not just financial or political ones. Sufficient political will can remove political or financial challenges outright, but no amount of political will can prevent an insufficiently reinforced mine shaft from collapsing.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 30th, 2011 at 11:53:32 PM EST
[ Parent ]
Farmers in the Mississippi Delta, especially in Arkansas, routinely switch from cotton to corn, soy or rice, depending on market conditions. Greece farmland is likely to show lower yields due to hydrology and rainfall, but the chief constraint would be purchase of crop specific harvesters. Technical knowledge could be imported from most US ag region state universities, amongst other sources.

The danger to use of lignite, in addition to its carbon footprint, would be for it to underlay productive cropland, as it is usually surface mined. State elected representatives from south west Arkansas just now have visions of sugar plums regarding use of lignite to power merchant power plants. Texas put the kibosh on such plans in Texas on, of all things, environmental grounds, though there may have been deeper underlying reasons.

There will always be tourism and some areas can boom even during an overall decline. I too suspect Greece can benefit here via a devaluation-new currency. The trick would be to see that the cash goes to things vital to running the economy rather than to bonuses to bankers. That is where I wonder if there are any left capable of running a socialist economy. Seems like we need an new acronym: SINO = Socialist In Name Only.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue May 31st, 2011 at 12:03:54 PM EST
[ Parent ]
ARGeezer:
Farmers in the Mississippi Delta, especially in Arkansas, routinely switch from cotton to corn, soy or rice, depending on market conditions. Greece farmland is likely to show lower yields due to hydrology and rainfall, but the chief constraint would be purchase of crop specific harvesters. Technical knowledge could be imported from most US ag region state universities, amongst other sources.

So buy big machines and bring in Midwestern American experts in sustainable productivist market-driven agriculture, and get Greece exporting cash crops?

Even if that were to be wished, the comparison with the Mississippi Delta is way out. Greece is mostly mountainous.

by afew (afew(a in a circle)eurotrib_dot_com) on Tue May 31st, 2011 at 01:03:31 PM EST
[ Parent ]
Well, the land is now being used that way for cash crops, and while it might be more quaint to have scenes of traditionally clad peasantry wielding sickles and bringing in the sheaves, using mechanized agriculture to grow wheat might be a better way to prevent starvation. And many mid-west US farmers are starting to convert to less chemical intensive approaches and finding it somewhat more labor intensive but more profitable. One could hope that agricultural expertise independent of Big Agriculture would be retained. I know this exists at the University of Missouri.

And careful with the stereotypes.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue May 31st, 2011 at 03:42:50 PM EST
[ Parent ]
In Greece, the movement is completely and totally in reverse. The cash crop industry has been hurtful to agriculture because they are competing against megaliths. Greece has a central plain in Thessaly that has factory farms. But Greece, next to Madagascar, has more biodiversity in plants and herbs than anywhere in the world, and Greeks have not exploited that advantage. They are changing now as they are using agricultural funds to eliminate cash crops, plant indigeneous herbs, to see what will take.
by Upstate NY on Tue May 31st, 2011 at 07:45:51 PM EST
[ Parent ]
The mines are already there and functioning: Curently Greece is still getting close to 60% of its grid energy from lignite, which is the sole reason it has a relatively high carbon footprint, if I recall correctly. Thus the only thing that would have to be done is intensify production, recomission coal plants etc.

As for productive land: the breadbasket of Greece was traditionally Thessaly. CAP subsidies have pretty much led to a conversion of most of the available farmland (which had in the not to distant past secured wheat self-sufficiency) to cottonfields, an unsustainable practice that has led to huge drought and irrigation problems, not least of which is the poisoning of aquifers. There are other medium sized areas with a large production base (i.e. Crete which produces vegetables year-round). Agriculture is based mostly still, on small and medium-scale units.

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Tue May 31st, 2011 at 02:20:01 PM EST
[ Parent ]
According to the Portuguese Green Party (alert: A Stalinist puppet satellite of the communist party) our food dependency when we entered the EEC was 20%, not it is 75%!

I do not have data for the EEC entry, but the 75% figure for the present is probably correct.

by cagatacos on Tue May 31st, 2011 at 06:35:33 PM EST
[ Parent ]
I read somewhere that Greece is by far and away to largest importer of beef from France. Traditionally, beef is not a Greek staple.
by Upstate NY on Tue May 31st, 2011 at 07:47:05 PM EST
[ Parent ]
I just checked out that Greece is 25% self-sufficient in beef 50% in cow's milk, 85% in sheep and goat, 95% in poultry products. But it is heavily dependent on venterinary drug imports etc. Which complicates the whole picture. A complication that is bound to be ubiquitous, since the greek agricultural economy is part of the global economy: it bought inputs where they were cheaper. So if you do go it alone, you will have to develop a veterinary drug industry, possibly make your own tractors or whatever else they're using now etc. It isn't easy to quantify self-sufficiency.

The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Tue May 31st, 2011 at 08:13:14 PM EST
[ Parent ]
But for a balanced trade, you do not need to replace all imports, just so much that the exports and imports match.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se
by A swedish kind of death on Wed Jun 1st, 2011 at 07:00:47 AM EST
[ Parent ]
Yeah but one can expect that they will be punished...Sanctions without declaration. Of course they will survive thanks to greed of others but at what cost? One way or another Greeks are fucked...unfortunately...

Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Wed Jun 1st, 2011 at 06:26:22 PM EST
[ Parent ]
Yeah.

Ricardian economics makes every part completely dependent on the whole. If you try to exit they will crush you (withdraw food, or medicines, or basic industrial tools, ...)

Sovereignty requires a good measure of autonomy. That is "inefficient" and not "serious" economics.

Any good solution for Greece (or Portugal) requires investing in a measure of food autonomy (and other basic stuffs). 80% food dependence on the exterior as to become 20%. This has to happen NOW.

Another good reason to support things like Transition movements.

by cagatacos on Wed Jun 1st, 2011 at 11:10:42 PM EST
[ Parent ]
Yeah...Looks like we should go backwards cause globalization made dependent...Good old times when everything we needed was made in our country ;)
Well as everything we need here in Australia (except mining) is made in China and practically almost all Australian factories have moved there I wonder what would happen if once we for whatever reason have to depend just on our selves? No people with manufacturing skills and we can't make our own machines...We'll probably need to go back to basics...

Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Thu Jun 2nd, 2011 at 12:06:28 AM EST
[ Parent ]
Interestingly I did not say everything but going from 80/20 to 20/80. Do you understand the difference? Between black and white, some say that there might be shades of grey. Some even talk of different colours...

And if we do not roll back globalization quite a bit, the untameable complexity of the system will take care of it. It is taking care of it!

by cagatacos on Thu Jun 2nd, 2011 at 12:37:55 AM EST
[ Parent ]
Well I did not mean to offend you...I actually agree with you.

Science without religion is lame, religion without science is blind...Albert Einstein
by vbo on Thu Jun 2nd, 2011 at 03:21:02 AM EST
[ Parent ]
Even if Greece submits and gives up sovereignty there are always ways to gum up the works.

http://en.wikipedia.org/wiki/Agrafa

As I said earlier, giving up sovereignty to the EU will only reinforce some of the history and attitudes which contributed to Greece's problem in the first place.

You think Greece has a large black market now? Just wait!!!!!

by Upstate NY on Fri Jun 3rd, 2011 at 11:06:48 AM EST
[ Parent ]
That means they have to be thrown out of the EU. While not impossible it is quite unprecedented, I do not even think there is a procedure for that. As I see it ECB has made a power-grab but their hold on the reins is shaky and I don't they could pull of throwing out countries from the EU.

Easy to say from the relative safety of Sweden, but there it is.

Sweden's finest (and perhaps only) collaborative, leftist e-newspaper Synapze.se

by A swedish kind of death on Thu Jun 2nd, 2011 at 03:31:20 PM EST
[ Parent ]
A couple or three defaulting counties could quickly refocus the ECB's attention while dramatically decreasing its prestige and clout.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Jun 2nd, 2011 at 07:57:55 PM EST
[ Parent ]
Just wondering: would tourism be considered an export? The net effect is the same, foreign dollars coming from abroad.
by Upstate NY on Mon May 30th, 2011 at 08:35:46 PM EST
[ Parent ]
Tourists are coming to enjoy the unique place values of Greece, which, aside from the conveniences of hotels, might be enhanced by a bit of rusticity such as an increase in sail and horse drawn transit. For this privilege they would exchange their dollars, pounds, euros, yen, etc. for the local currency. Provided there is normal maintenance, which provides local employment, it is a renewable resource that yields foreign currency.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon May 30th, 2011 at 09:08:35 PM EST
[ Parent ]
Unless I misremember my national accounting classes, tourism is counted as foreign trade under standard EU accounting conventions.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon May 30th, 2011 at 11:50:06 PM EST
[ Parent ]
It has the same economic effect.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue May 31st, 2011 at 12:04:49 PM EST
[ Parent ]
An "invisible export".
by afew (afew(a in a circle)eurotrib_dot_com) on Tue May 31st, 2011 at 01:04:45 PM EST
[ Parent ]
Liquid fuel's gonna be a problem, though, particularly with all those islands connected by boat.
 

Yeah...Serbia managed under sanctions (Thanks to Danube River and greedy Romanians and Bulgarians but also other Europeans) but we had to buy petrol in Coca Cola bottles of 2 litters on the streets for a price of 3 DM / litter. Black market never stops (and even better works when it's organised by people in government).At the time we had central heating in our houses that used diesel. We arranged for cistern to come to fill our tank and surprise surprise it was a German cistern with big COW painting on it sides (obviously once used for milk). The driver was a Bosnian man and everything was organised trough our at that time opposition party (meaning that they obviously had some deal with Milosevic cause his people had monopoly on petrol and cigarettes on a black market)...Go figure. Desperate times call for desperate measures, ha-ha.
Prepare for the hellish century...


Science without religion is lame, religion without science is blind...Albert Einstein

by vbo on Mon May 30th, 2011 at 11:53:43 PM EST
[ Parent ]
From reading Joe Sacco's book, SAFE AREA GORAZDE, it was interesting to see illustrations of electric turbines rigged up in the rivers. Being cut-off meant people had to rely on "clean energy!"

Odd that.

by Upstate NY on Tue May 31st, 2011 at 11:47:01 AM EST
[ Parent ]
Liquid Fuel:

Not too far across the Med there's a Revolutionary Government having fuel but needing munitions, military communication systems, & etc.  The Greeks have a supply of superfluous military gear and need fuel.

"Guns for Oil" worked for the US.  Don't see why it wouldn't for the Greeks.


She believed in nothing; only her skepticism kept her from being an atheist. -- Jean-Paul Sartre

by ATinNM on Tue May 31st, 2011 at 11:54:58 AM EST
[ Parent ]
One way to make money on the armaments France and other EU members twisted Greek governmental arms and/or greased palms to buy. Just sell the armaments at a profit, perhaps with "instructors" included. After all, Greece has the longest tradition in Europe of dealing with Africa.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue May 31st, 2011 at 12:08:47 PM EST
[ Parent ]
Good documentary about Wall Street ("Inside Job"):

http://www.youtube.com/watch?v=iFfTcAcGjcU

by kjr63 on Mon May 30th, 2011 at 05:42:00 PM EST
I believe (could be wrong) that only Italy was helping out...

This time it's all of us!

The Hun is always either at your throat or at your feet. Winston Churchill

by r------ on Tue May 31st, 2011 at 11:43:56 AM EST
(Not helping, Germany took over after Italy's own colonisation effort failed, if I remember that history right.)

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Tue May 31st, 2011 at 12:32:24 PM EST
[ Parent ]
Eurointelligence Daily Briefing: News flash from Germany: IMF won't pay for Greece
Frankfurter Allgemeine says it was almost sure that the IMF will not pay the fifth tranche for Greece; EU considers three alternative options: bankruptcy of Greece, the use of the EFSM as a stop gap; or a new programme; discussion to take place in Brussels today, with no immediate decision expected; Wall Street Journal reports that Germany has given up on the idea of a voluntary rescheduling; FT Deutschland reports that some unnamed central banks are warming up to the idea of a rescheduling; the troika agrees to a request from Greece to cut VAT from 23 to 20% to win political support for the austerity package; Handelsblatt writes that Greece is warming to the idea of an independent Treuhand privatisation agency; Portugal's centre-right PSD has increased its lead in the polls in the final days of the election campaign; more Irish banks have announced that they will burn their junior bondholders; in his last big speeches speech as governor, Mario Draghi lambasts the lack of reforms in Italy, and the way corporate interests interfere with the governance of the country; Frédéric Lemaitre warns about German exceptionalism, which is evident in the country's energy policy, its approach to the euro crisis;and its stance on Libya; Wolfgang Münchau explains why Germany has so few candidates for top positions in international finance and economics; Martin Wolf calls the eurozone a modern incarnation of the gold standard, and says its survival will necessity a centrally-backed banking system;John Plender, meanwhile, argues that Greece will eventually have to default, but not now.
(Google link)

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Wed Jun 1st, 2011 at 05:00:48 AM EST
In case you needed an example of the true meaning of "labor reform", here it is in one headline:   
Sub 600-euro wages for under young Greeks: Government agrees to more labor market reforms as part of deal with troika
Employers will be able to offer young people monthly salaries of less than 600 euros as part of labor market reforms that the government has agreed with the European Union and the International Monetary Fund, according to sources.

This was demanded by the troika. Along with other things (that I'll write about as soon as possible) that will make your blood curl (and should, Greece is a testing ground for the rest of the EU, run by fiscal Mengeles)... The measures are so austere and dead-end that even the sheep in the ruling party's parliamentary group seem about to revolt. Thw government might be teetering as we speak - a good thing: If we are going to hell, I demand at least that the people's will as to the way we follow to get there be heard. As a last wish or something....

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Thu Jun 2nd, 2011 at 06:14:05 AM EST
I'm bound to be the cynic here, but isn't the standard route still viable: centre-'left' governments brings austerity through parliament, then disintegrates, then in snap elections the false dichotomy believing part of the population elects the centre-right, which reinforces the 'reforms'? (Which doesn't mean that the economic meltdown won't bring them down later, too.)

*Lunatic*, n.
One whose delusions are out of fashion.
by DoDo on Thu Jun 2nd, 2011 at 06:50:12 AM EST
[ Parent ]
A revolt of the back benchers might be the best path forward for the possibility of a Greek Socialist Party that is more than Socialist In Name Only, especially if they refuse to accept draconian demands. The conservatives presided over the bulk of the creation of this problem, if I understand correctly. Let also them then take a big drink from the poisoned chalice of false solutions.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Jun 2nd, 2011 at 10:14:52 AM EST
[ Parent ]
There seems to be a movement of Socialist MPs who have demanded "explanations" from the government in order to vote for the destruction that they are presenting. As we speak the presence of over 100.000 people daily in the squares of major Greek cities creates huge pressure.

So does the fact that it seems that no member of parliament can survive a stroll or a night out unharmed:

The day before yesterday, a small part of the Syntagma crowd jeered and gestured the MPs Mercedes and blocked MPs from leaving the government building, forcing them to leave through the "back door" practically. Yesterday a delegation of MPs and EuroMps were hunted in Corfu by a crowd that learned of their presence and were forced to flee the marina they were dining in, in a fishing boat. The Minister of health was booed and had things thrown at him in Iraklion. Today the Government spokesman was protected by a full squadron of police officers, as an instant mob gathered the moment he was recognized in Argyroupoli, a middle class suburb of Athens (they tend to not stray into working class suburbs at all) and stones, yogurt and other items were thrown at him.

Sunday the two largest TV channels f/b fan pages were clobbered and one was pulled down by an attack of pointed and enraged comments at their not showing the huge demo except for 30 seconds and underestimating the numbers of the crowd. The media are in a continuous disapproval or paternalizing mode but they are finding that people just tune out.

Things are ..."developing" rapidly. By the time the government is ready to pass its colonial agreement, it might not have a majority in parliament... We shall see...

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Thu Jun 2nd, 2011 at 10:13:30 PM EST
[ Parent ]
  It's a treat to have your contribution from the center of this storm.

   When you write further on the outrageous-ness of it all, keep in mind that, in English, hair curls, while blood boils or, as you may have intended, "curdles".  Perhaps though, in this set of circumstances, we need a new image.  

    A little more than seventy-one years ago, Franklin Roosevelt spoke to the American people to explain to them the common-sense urgency of their understanding that, faced with the threat of Hitler's regime, the U.S. had no better course than to give every possible aid to the defence of Britain, since, if Britain fell, the U.S. would find themselves before a far greater danger.

   It is high time that thinking people in the middle class and upper-middle class, including, especially, the middle ranks and upper middle ranks of multinational management recognize that their own heads will eventually be on the block if they fail to make common cause with those far lower in the pecking order.

    The kind of tyranny that Hitler would have subjected the world to is now being put in place by a remorseless cartel of financial and other corporate power interests.  If they aren't stopped and reversed, there is no area of civil society that will not be ravaged for their benefit.

 

 

  Press Conference on "Lend-Lease", December 17, 1940 (excerpts):

    "That would be on the general theory that it may still prove true that the best defense of Great Britain is the best defense of the United States, and therefore that these materials would be more useful to the defense of the United States if they were used in Great Britain, than if they were kept in storage here.

    "Now, what I am trying to do is to eliminate the dollar sign. That is something brand new in the thoughts of practically everybody in this room, I think--get rid of the silly, foolish old dollar sign.

    "Well, let me give you an illustration: Suppose my neighbor's home catches fire, and I have a length of garden hose four or five hundred feet away. If he can take my garden hose and connect it up with his hydrant, I may help him to put out his fire. Now, what do I do? I don't say to him before that operation, "Neighbor, my garden hose cost me $15; you have to pay me $15 for it." What is the transaction that goes on? I don't want $15--I want my garden hose back after the fire is over." ...

 

 

  Roosevelt, in his fire-side chat, "Arsenal of Democracy Speech, December 29, 1940 (excerpts) :

   "Never before since Jamestown and Plymouth Rock has our American civilization been in such danger as now.

   "For, on September 27, 1940, by an agreement signed in Berlin, three powerful nations, two in Europe and one in Asia, joined themselves together in the threat that if the United States interfered with or blocked the expansion program of these three nations-a program aimed at world control-they would unite in ultimate action against the United States.

    "The Nazi masters of Germany have made it clear that they intend not only to dominate all life and thought in their own country, but also to enslave the whole of Europe, and then to use the resources of Europe to dominate the rest of the world.

   "Three weeks ago their leader stated, "There are two worlds that stand opposed to each other." Then in defiant reply to his opponents, he said this: "Others are correct when they say: `With this world we cannot ever reconcile ourselves.' . . . I can beat any other power in the world." So said the leader of the Nazis.

    "In other words, the Axis not merely admits but proclaims that there can be no ultimate peace between their philosophy of government and our philosophy of government.

   "In view of the nature of this undeniable threat, it can be asserted, properly and categorically, that the United States has no right or reason to encourage talk of peace until the day shall come when there is a clear intention on the part of the aggressor nations to abandon all thought of dominating or conquering the world.

    "At this moment, the forces of the states that are leagued against all peoples who live in freedom are being held away from our shores. The Germans and Italians are being blocked on the other side of the Atlantic by the British, and by the Greeks, and by thousands of soldiers and sailors who were able to escape from subjugated countries. The Japanese are being engaged in Asia by the Chinese in another great defense."

   ...

 

 

     If we expect important help from today's president, Barack Obama, we're simply deluding ourselves and counting on help that will never come--not from a man who has failed so far and so terribly to understand the current situation.  He is too much a product of the system that is destroying civil society sector by sector, nation by nation, region by region.


"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Fri Jun 3rd, 2011 at 08:13:49 AM EST
[ Parent ]
  that should have been, "a little less than seventy-one years ago"...

   and, the above is a reply to Talos's post at

  http://www.eurotrib.com/story/2011/5/29/202546/716#164

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Fri Jun 3rd, 2011 at 08:17:21 AM EST
[ Parent ]
Heh, about the "blood curls" thing, in my defense it seems to be a mistake native speakers also make (not very educated native speakers perhaps, but still... :-) ), so I wrote what I thought I was hearing :-)

About Obama, I don't expect anything from the President of the US, but I fear that "economic governance" in the EU, makes him seem like a latter day FDR in comparison. But only in comparison. No delusions here.

Where I am now two things matter: secure a relatively reasonable plan for feeding my family, which might involve some form of immigration, and fight the quisling government and its far-right de facto allies, a development that complements your Hitler reference I believe...

The road of excess leads to the palace of wisdom - William Blake

by talos (mihalis at gmail dot com) on Fri Jun 3rd, 2011 at 08:40:33 AM EST
[ Parent ]
Actually, Obama is relevant in comparison to what's going on in Europe.

We can't take all these things out of context.

We have to recognize that although Obama surely chose TARP over nationalization, he also pressed on other issues that would have helped, but was rebuffed by Europe.

At the first G20 after his presidency, he pushed for global stimulus, but was cornered every time. First by Canada, which is understandable that Canada would resist any such measures given the stability of its banking system, but then by the whole of Europe that rejected stimulus. Within the USA, Obama installed health care programs and a gov't restructuring of the auto industry that was highly controversial, and reeked of central planning for many of our rightwing knee-jerk artists.

One might fault Obama for TARP, but he was forced to give up on a concerted effort for global stimulus, because any American attempt to do so would have been sopped up in the global markets. So the USA elected the backdoor way of doing it, by adopting one QE plan after another, and given the current interest rates, I bet the shorts are sniffing around for asset bubbles in 3rd world countries right now.

by Upstate NY on Fri Jun 3rd, 2011 at 10:53:20 AM EST
[ Parent ]
Yes, the EU rebuffed Obama on the argument that, because the EU had a more extensive social safety net with larger automatic fiscal stabilizers, there was no need for a specific stimulus.

A year later, the automatic fiscal stabilizers amounted to a deficit of about 10% of GDP in much of Europe. This sent the Serious People into an inflation panic. The Growth and Stability Pact had been breached!

The EU then argued that the automatic fiscal stabilizers were a violation of EU fiscal rules and needed to be reined in.

So 2009, the year of stimulus, was followed by 2010, the year of austerity. The markets did their bit to help the Serious People by repeatedly seizing around sovereign Euro debt.

2011 will be the year of the depression or, at least, the double-dip recession.

Economics is politics by other means

by Migeru (migeru at eurotrib dot com) on Fri Jun 3rd, 2011 at 11:00:27 AM EST
[ Parent ]
The chief thing for which to fault Obama is not moving aggressively to reign in TBTFs and restore financial regulation. He dealt with the effects in a somewhat reasonable way, but did nothing about the cause. But he just might get another four years simply for not advocating total insanity in economic policy. It is a very low bar in the USA.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Jun 3rd, 2011 at 02:11:04 PM EST
[ Parent ]
As we near FINALLY the passage of some regulations, the ratings agencies are downgrading American banks because of their limited ceilings.

I thought ratings agencies were about rating one's stability, not profit growth?

by Upstate NY on Fri Jun 3rd, 2011 at 02:22:15 PM EST
[ Parent ]
They're about rating one's probability of default.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Fri Jun 3rd, 2011 at 02:26:10 PM EST
[ Parent ]
They're They pretend to be about rating one's probability of default.

FIFY.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Fri Jun 3rd, 2011 at 03:19:43 PM EST
[ Parent ]
So, fewer profits from shady dealing = more probability of default
by Upstate NY on Fri Jun 3rd, 2011 at 03:23:25 PM EST
[ Parent ]
Worse. The deeper we get into the unwind of the debt the more likely it is that banks will be left holding the bag as shady deals reveal their fat tail risks. Who knew that the counter-party you have been paying for the default risk CDO couldn't really insure you. Even worse, lots of the swaps were just cosmetic: I'll insure you, you insure me, and since we are both insured each can treat the insured assets as AAA and hold less reserves, maybe even repo them at a significantly lower haircut. That is one problem with private, Over The Counter deals.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Fri Jun 3rd, 2011 at 09:39:44 PM EST
[ Parent ]
Government agrees to more labor market reforms as part of deal with troika
Employers will be able to offer young people monthly salaries of less than 600 euros as part of labor market reforms that the government has agreed with the European Union and the International Monetary Fund, according to sources.
This was demanded by the troika. Along with other things (that I'll write about as soon as possible) that will make your blood curl (and should, Greece is a testing ground for the rest of the EU, run by fiscal Mengeles)...
Irish Times: Trichet calls for EU finance ministry (June 3, 2011)

First, the context:

Mr Trichet's proposals - carefully phrased as hypothetical ideas - came in a speech in Aachen yesterday where he was awarded the prestigious Karlspreis for services to European unity.
That would be the Charlemagne price, for the German-impaired. So, what vision does Trichet have for the future of the EU?
"Would it go too far if we envisaged . . . giving euro area authorities a much deeper and authoritative, say in the formation of the country's economic policies if these go harmfully astray?" asked Mr Trichet, suggesting "a direct influence, well over and above the reinforced surveillance that is presently envisaged?"
Yes, actually, that would go too far.
In Mr Trichet's view, this EU finance ministry need not administer a budget but monitor directly fiscal and competitiveness policies. This ministry could ensure closer integration of financial services across the EU and sit on boards of international financial institutions.
Of course not, an EU budget could actually be put to useful use. Much better to have the authority to go in and impose austerity directly by overruling the parliament.
ECB chief economist Jürgen Stark, in an interview with Italy's Il Sore 24 Ore, repeated the suggestion of external budgetary intervention. "If countries in difficulty do not introduce the necessary adjustment measures, then interfering in their national policy could be a necessary way of ensuring the correct functioning of monetary union," said Mr Stark.
Little Mengeles, setting up the position of Economic Mengele in Chief.

Economics is politics by other means
by Migeru (migeru at eurotrib dot com) on Fri Jun 3rd, 2011 at 08:32:34 AM EST
[ Parent ]
   We must now seek ways to help and put them to effect.  

  We must now search our consciences and our imaginations and seek every useful means to give immediiate direct aid to the Greek people.

   I reiterate Mig's proposal for a letter--drawing on the keen insights of this site's analysts of the crisis--urging a clearly stated set of reasons why the IMF/Germany-back austerity is compounding error on error and spreading a deepening misery.

 

"In such an environment it is not surprising that the ills of technology should seem curable only through the application of more technology..." John W Aldridge

by proximity1 on Fri Jun 3rd, 2011 at 08:56:25 AM EST
With SPD (be it Gerhard Schroeder or anybody else) in charge of Germany, things would have developed rather differently. I believe even with someone like Helmut Kohl, the situation would have been different.

If you have read the Steinmeyer-Steinbrueck article on the Financial Times or the late Tomaso Padoa-Schioppa-Peter Bofinger et altri article, also on the Financial Times, it is quite clear.

These people understand that Greece needs fair financing not punitive rates in order to put its house intact. But Merkel has ignited a populist revolt in Northern Europe that now looks irreversible.

"Eurozone leaders have turned a €50bn Greek solvency problem into a €1,000bn existential crisis for the European Union." David Miliband

by Kostis Papadimitriou on Fri Jun 3rd, 2011 at 06:41:35 PM EST
Because I know that the ET community loves this stuff. Some idea of where one could follow the money to, if one were so inclined:

...Existential issues aside, Greece faces a $43 billion funding gap by next year.

That's about the same amount that has gone offshore since the start of 2010, Greek treasury officials say.

Much of that money has found its way into London's real estate market where agents like Panos Koutsogiannakis have seen surge in interest from Greek investors.

"We've had a steady stream of enquiries all of this year," Koutsogiannakis, a Greek-Australian, tells me from the London offices of realtor Hyde Park Agencies.

"Most are cash buyers and some haven't even seen the properties before. I have one client transacting on a $1.3 million flat which they haven't ever seen."

Koutsogiannakis says his average Greek client is spending between $1.2 million and $2.4 million on apartments in some of the most expensive areas in the British capital, like Knightsbridge and Mayfair.

Four doors along, realtor Stephen Kalogroulis of Hellas Helvetia says he is getting up to 20 enquiries a week.

He tells me the parlous state of Greece's economy is "a standard conversation" he has with Greek investors on a near daily basis.

"They want to talk about it all of the time," he says.

"They want to talk about how the property market has collapsed, how there are no jobs."

There may be a dearth of employment opportunities in Greece but the boom in demand for Greek speakers is attracting young workers to London in droves.

"Loads of people are coming over here and they'll take anything they can get," says Kalogroulis.

"We advertised for a lettings agent four weeks ago and we got 25 enquiries from Greece. Normally we would get only one or two."

Kalogroulis eventually filled the post last week, hiring a civil servant from Athens who has now moved to the UK.



The road of excess leads to the palace of wisdom - William Blake
by talos (mihalis at gmail dot com) on Fri Jun 3rd, 2011 at 07:41:07 PM EST


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